Allstate stock price target raised to $235 by KBW

On Wednesday, Keefe, Bruyette & Woods (KBW) analyst Meyer Shields adjusted the price target for Allstate (NYSE: NYSE:ALL) shares, increasing it from $228.00 to $235.00. Shields maintained an Outperform rating on the insurance company’s stock. The revision follows Allstate’s first-quarter earnings report for the year 2025, which Shields cited as a contributing factor to the new valuation.

Shields highlighted Allstate’s performance, noting that the company exceeded his earnings expectations for the first quarter of 2025. The company has demonstrated strong profitability, with revenue growing 11.49% over the last twelve months and trading at a P/E ratio of 13.61x. As a result, he revised his earnings per share (EPS) estimates for 2025 and 2026 upwards, to $17.75 and $20.90, respectively, from the previous estimates of $16.00 and $20.75. The adjustments account for the quarter’s outperformance and include assumptions of lower expense ratios. These positive factors are partially offset by expectations of higher core and catastrophe loss ratios, as well as decreased income from the Service segment.

The analyst projects that Allstate’s improved core loss ratio and diminishing rate increases will lead to growth in personal auto policies in force (PIF). This growth is anticipated to drive both earnings growth and multiple expansion for the company. InvestingPro data reveals that Allstate has maintained strong returns over both the last five and ten years, positioning it as a prominent player in the insurance industry. The new price target of $235.00 is based on 11.2 times KBW’s projected 2026 earnings per share for Allstate.

Shields’ analysis suggests that Allstate is on a trajectory for positive auto PIF growth, which is a key metric for the insurance industry, indicating the number of active policies. The expectation is that this growth will contribute positively to Allstate’s financial performance in the coming years.

Investors and market watchers now have a revised metric from KBW to consider when evaluating Allstate’s stock performance and potential. The company’s shares continue to be rated Outperform, reflecting analyst confidence in its ability to outpace the general market or its sector in the near future.

In other recent news, Allstate has reported its first-quarter 2025 earnings, which showed a mixed performance. The company achieved a revenue of $16.5 billion, significantly exceeding the forecast of $13.94 billion, marking a positive surprise of 18.5%. However, its adjusted earnings per share (EPS) of $3.53 fell short of the expected $3.71, representing a miss of about 4.9%. Raymond (NSE:RYMD) James has responded to these developments by maintaining a Strong Buy rating on Allstate and increasing the stock price target from $240 to $250. The firm also raised its operating EPS estimates for 2025 and 2026, suggesting confidence in Allstate’s future financial performance. The company’s strategy includes introducing new insurance products and expanding market reach, which has contributed to its robust revenue growth. Allstate’s management emphasized their focus on growth and customer experience, despite potential challenges such as tariff impacts on auto insurance. The company maintains a strong capital position, supported by $3 billion at the holding company level, enabling it to continue its growth strategies effectively.

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